Revenge of Success, Dilemma to Change
1987 in Japan was the height of bubble economy, unstoppable growth, a lot of new opportunities and interests, and normalisation of travelling abroad. It was the dawn of Japanese consumer products with big brand names, Walkman being the leading example, away from the traditionally appreciated motor bike, cars, home electronics products.
This year, 2017, marks 30 years anniversary of the birth of “SuperDry”. It is Japan made mega brand beer that you see all around the world, where you can consume alcohol.
SuperDry reached 100 million cases within two years of launch, nearly 200 million in 2000. Since then it has declined back to 100 million in 2016, including second line products.
Although it still commands the significant lead in the shrinking Japanese beer market, it is visibly losing grounds. The second best-selling beer brand sold 35 million cases to illustrate the major strength, but other beer manufacturers have taken different paths to maintain and increase the sales.
Challenger to Establishment
CEO of Asahi Group Holdings tells,
“How do we drive the value? Innovation is created only when the new product is launched. If SuperDry tries to innovate itself, the consumers will become alienated.”
It is quite telling that this once innovative challenger has become the establishment. There are so much to defend now.
Super Dry changed Japanese beer industry, by breaking the rules by changing the traditional manufacturing process. Asahi carried out extensive market research on the changing drinking habits. The finding was the need and lack of less bitter, refreshing beer that matches food choices that had been westernised. This trend was heavily featured among the 20s and 30s in mid-eighties and gave birth to SuperDry, the challenger to break the rule, to change the perception of beer, to place the beer as not a simple alcoholic drink but a statement and communication tool. The new marketing campaign, using an international journalist as the main image character, with fast moving news-clip like commercial adverts attracted a lot of attention. The risk taking project more than paid off and hurled the then underdog up to the top of the game.
What followed was sometimes referred as Dry Beer War. All the competitors launched Dry Beer. The mistake was that the definition of this marketing segment was not only very vague but mostly dependant on Asahi’s innovation, its leading brand. All the products directly competing against Super Dry were the failures, and in some cases, it backfired. The biggest loser was Kirin, then the leader, who changed the manufacturing method of their best-selling beer to compete. They didn’t only lose Dry Beer War but the total market share. The beer industry had a clear champion.
Dilemma to Change, Revenge of Success
This history has affected Asahi’s subsequent strategy. Asahi is now in the position of not being able to move the champion of the company, Super Dry, as they rely on this brand for 50% of the company revenue. The hero has turned into a cash cow, which is incredibly hard to move and change.
Asahi is launching series of derivatives of SuperDry brand. The fourth item called “Extra Hard”, fizzier and higher alcohol content, was launched on 14th March, and it is doing well as the limited edition of the primary product. It is essential to keep generating new interest to keep their dear target of 100 million case line, and these new lines are doing just the job in the shrinking domestic beer market. But the history has repeatedly shown that taking risk is not easy to do: Simply following others will end up in the failure. When you are the leader, it is easier to cling to the policy of risk evasion.
To Change Again to Survive…
With 95 percent of the employee joined the company after the incredible success, the ground for challenge is not fertile. The marketing strategy, product development, research all revolve around one giant which nobody dares to move or change. In 30 years, they made no significant change to the product except for a slight shift in the colour of the packaging. Obviously, it is imperative to keep the existing, hardcore fans of Super Dry. Those who were in the twenties at the time of launch is now in fifties and still keeps on purchasing and ordering the same brand. They do not want to change, but what if they did?
Asahi is struggling to develop the challenger spirit while being the market leader. It is no easy task, and some of the very senior management jokingly comment that this success story should not have happened. The time is now to make a big decision and move forward.
The recognition of own stagnancy is the starting point. It may be time for the champion to go back to the starting line, see and hear the customers, and break the taboos, just like 30 years ago.
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